Chinese tech giant Huawei has recently reported that it is running out of SoCs to manufacture smartphones. The company will also have to halt the production of its flagship Kirin processors. These chips were used in its own as well as smartphones from other companies. This is a direct result of the serious sanctions that the US imposed on Huawei and US companies it is in business with.
Huawei is one of the biggest producers of smartphone and connected technologies in the world. And this is a huge setback for the company, because like most smartphone companies it is dependent on American technologies and companies for providing a complete smartphone experience. The US-China tension over technology and the resulting security issues resulted in these sanctions. US President recently imposed sanctions on Chinese apps TikTok and WeChat as well.
The sanctions on Huawei were imposed last year which cut off Huawei’s access to US components and technologies. This resulted in companies like Google retracting support of Huawei smartphones. These sanctions were made stricter in May when the White House outright barred vendors worldwide from producing components for Huawei using US technology.
Richard Yu, president of the Huawei’s consumer unit said that production of Kirin chips will stop on September 15. This is because the chips are made by contractors using US manufacturing technology. He specified that Huawei does not have the capability to manufacture their own chips.
“This is a very big loss for us. Unfortunately, in the second round of U.S. sanctions, our chip producers only accepted orders until May 15. Production will close on September 15.” said Yu. “This year may be the last generation of Huawei Kirin high-end chips.”
He emphasized that Huawei’s smartphone manufacturing has no chips of it’s own and no supply of them as well. He added that the company’s sale will probably be lower than last year’s 240 million handsets.
Huawei became the world’s highest selling smartphone brand overtaking rivals Samsung in the first quarter which ended in June according to Canalys.